ONGC KG Basin gas pr from 12mn mt cube

Jul 25, 2007, 01.00 AM IST

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NEW DELHI: Oil major ONGC will start producing 12 million standard cubic metres of gas every day from one of its KG basin blocks from 2012. The development is significant in the light of Reliance Industry’s gas production from mid-2008 in another block of the same basin.

ONGC’s block in the KG basin is next to RIL’s D6 block that is scheduled to start gas production from July 2008 with an initial output of 40 million standard cubic metres (mmscmd). RIL would double the output in about one year. “We evince an initial output of 12 million standard cubic meters per day (mmscmd) from the KG-DWN-98/2 block in 2012,” ONGC chairman & managing director RS Sharma said. The company signed an agreement with GAIL India for transportation and marketing of the fuel.

Six discoveries have been made in the block so far, the largest being the December 2006 find that is estimated to hold an in-place reserve of 2.08 trillion cubic feet, Mr Sharma said. According to him, the 12 mmscmd is only a “preliminary estimate” of initial output and actual production can be “higher.”

“An appraisal of the discovery has been done by two independent domain experts. They would submit the report to the DGH next month. Once DGH approves of it, we will file a development plan for bringing the discoveries to production,” he said. The company is expected to file the development plan in 2008. Norwegian firm Norsk Hydro and Petrobras of Brazil are equity partners in the ONGC’s block for the development of the deep-sea gas find.

Mr Sharma said that the understanding with GAIL for transportation and marketing of the gas is not limited to the KG basin block but it may also include the company’s Mahanadi basin find. According to Mr Sharma, a gas discovery in the Mahanadi basin was not commercial on a standalone basis as estimates showed output was less than one trillion cubic feet (tcf).

“We have found hydrocarbons in a new structure and our assessment shows it is very small, less than 1 tcf, and on that basis it can not be commercialised and therefore we have to drill more wells,” Mr Sharma said.

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